OUCH! MS has to write off >$6bn in Q4 to post a Q4 loss

[Millenium]

M.U.G.E.N said:

Millenium said:
Suprised this took so long to post. :P

Anyways, I don't really understand this concept of writing off their value?

Guess we'll see a ~1B loss for the quarter then, not favourable, but not too bad all things considering.

Companies write off values based on the current value of assets (even liabilities etc) over time. Such a thing happens when a drastic change occurs to the overall value of an asset that lost it's value and can not be reasonably expected to change back to the estimated value in the foreseeable future. In such cases it's 'required' that they do a write off in US GAAP

Basically MS knows now this investment has gone to shit. It sucks but that's the nature of investments. You win some you lose some.

just woke up so if I just typed a bunch of gibberish hard to understand, I apologize :P

Cheers for explaining that (Accounting never was my strong point :p), makes sense now, I didn't even think of the fact that it was considered as a asset before you reminded :)